{"id":338780,"date":"2017-04-20T01:11:09","date_gmt":"2017-04-19T17:11:09","guid":{"rendered":"http:\/\/techcrunch.com\/?p=1478666"},"modified":"2017-04-20T01:11:09","modified_gmt":"2017-04-19T17:11:09","slug":"a-slack-integration-is-magics-next-act","status":"publish","type":"post","link":"https:\/\/people.utm.my\/asmawisham\/a-slack-integration-is-magics-next-act\/","title":{"rendered":"A Slack integration is Magic\u2019s next act"},"content":{"rendered":"

<\/p>\n

Remember the text message-based service on-demand company, Magic Assistant<\/a>?<\/p>\n

In a whirlwind two months after\u00a0the service\u2019s launch on Product Hunt<\/a>\u00a0Magic\u00a0went viral based on its\u00a0claims to deliver anything<\/a>; promptly raised a rumored $12 million from Sequoia Capital<\/a> (with Sir Michael Moritz, KBE joining the board); and then went into hiding as it figured out an actual business plan.<\/p>\n

The company emerged a year later with a premium pricing plan<\/a> and more perspective on what their business actually can be\u2026. and then returned to relative obscurity and the basic blocking and tackling of business building.<\/p>\n

Well it\u2019s back again, and this time with Slack!<\/p>\n

The company has integrated its text-based, on-demand service as-a-service into the enterprise messaging monster that is Slack.<\/p>\n

A Slack integration isn\u2019t all that special (almost\u00a0everyone is doing it<\/a>), but it did give us a chance to catch up with the Magic\u00a0team and find out how things have been going.<\/p>\n

According to them, the answer is pretty well.<\/p>\n

For those of y\u2019all who don\u2019t remember the backstory, Magic launched on\u00a0Product Hunt in 2015 as a side project for the five Oberlin graduates (holler at your alma mater) who were in Y Combinator at the time working on Bettir<\/a>, a blood pressure monitoring app.<\/p>\n

When Magic took off, the team sidelined Bettir and began working full time on Magic. It took off like a rocket, but the initial business was in no way a guaranteed win.<\/p>\n

As our own long gone but not forgotten co-editor in chief wrote at the time:<\/p>\n

\n

According to my Magic operator, between 9 and 13 percent of all Magic orders are delivered by Postmates (Magic founder and CEO Mike Chen tells me the company has not yet calculated that statistic). So Snapguide founder\u00a0Daniel Raffel<\/a>,\u00a0who compared<\/a> the delivery times of Postmates and Magic, is sort of defeating the purpose. For example, Raffel\u2019s Magic lunch order was also delivered via Postmates, but Magic also uses other on-demand players like\u00a0GrubHub and Eat24.<\/p>\n

The model of taking a loss on orders doesn\u2019t scale. Chen, who studied philosophy and computer science at Oberlin College, estimates that the company breaks even on\u00a050 percent of orders, loses money on 25 percent and profits on\u00a025 percent \u2014 which he says is breaking even overall. Operators are supposed to factor in the time they spend interacting with customers and vendors into the Magic charge.<\/p>\n<\/blockquote>\n

The launch of the Magic plus service solved that problem, when\u00a0the company shifted its business model to provide a message-based service that can do anything for someone at a $100-per-hour fee.<\/p>\n

Since the launch of that service, Magic has been working to reduce costs through a combination of artificial intelligence and human interactions. The company currently employs roughly 150 people full time to handle the orders that come in.<\/p>\n

\u201cIn the beginning we thought it was going to be food deliveries,\u201d Chen told me. \u201cIt\u2019s become a replacement for a personal assistant or an executive assistant.\u201d<\/p>\n

The sticker price for that on-demand executive assistant has come down since the service\u2019s launch in January 2016. Now, one need only a pay a measly $35 dollars an hour to get some mechanical turk or other factotum to do the work rather than hire an actual person to do it full time. Chen assures me that Magic is still profitable at the price.<\/p>\n

\u201cWe have a positive margin on the transaction,\u201d Chen tells me.<\/p>\n

The evolution to\u00a0a concentration on servicing businesses happened as customers began to use the service more frequently. \u201cWhat was happening was that people would make personal requests on behalf of their businesses,\u201d Chen said.<\/p>\n

As it moves into more of a business service role, the company may find itself butting heads against office management services like Eden<\/a> or Managed by Q<\/a>.<\/p>\n

It\u2019s also a tacit acknowledgement of just how crowded services-for-services has become (and yes the ouroboros of the absurdity contained in the previous statement isn\u2019t lost on me). Facebook has a messaging platform that can connect anyone to any company to provide services, Alfred will offer you a concierge for personal services<\/a>.<\/p>\n

If you\u2019re willing to have the extension of a corporation listening to every word you say in your home, you can install a Google Home or an Amazon Echo and get them to deliver things to your door.<\/p>\n

\"\"<\/p>\n

Screenshot of Magic\u2019s own competitive analysis<\/p>\n<\/div>\n

Silicon Valley is filled to the brim with services companies offering to do things for users that they could pick up the phone and order for themselves, but in a four-hour-work-week world who has the time for that?<\/p>\n","protected":false},"excerpt":{"rendered":"

\"\" Remember the text message-based service on-demand company, Magic Assistant? In a whirlwind two months after\u00a0the service’s launch on Product Hunt\u00a0Magic\u00a0went viral based on its\u00a0claims to deliver anything; promptly raised a rumored $12 million from Sequoia Capital (with Sir Michael Moritz, KBE joining the board); and then went into hiding as it figured out an actual business plan.… Read More<\/a><\/p>\n

\n<\/img><\/a> <\/img><\/a> <\/img><\/a> <\/img><\/a> <\/img><\/a> <\/img><\/a>\n<\/div>\n

\"\"\/ <\/p>\n","protected":false},"author":5817,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[25],"tags":[59,66,26],"class_list":["post-338780","post","type-post","status-publish","format-standard","hentry","category-technology","tag-media","tag-techcrunch","tag-technology"],"_links":{"self":[{"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/posts\/338780","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/users\/5817"}],"replies":[{"embeddable":true,"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/comments?post=338780"}],"version-history":[{"count":0,"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/posts\/338780\/revisions"}],"wp:attachment":[{"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/media?parent=338780"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/categories?post=338780"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/people.utm.my\/asmawisham\/wp-json\/wp\/v2\/tags?post=338780"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}